Apple renews flat-rate iTunes music contracts, refuses variable song rates

[Bush_Eats_Beef]

LONDON (Reuters) - Apple Computer has renewed contracts with the world's four largest music companies to sell songs through its iTunes Music Store, after blocking their attempts to end iTunes' flat-rate pricing scheme, Apple said on Tuesday.

Apple Chief Executive Steve Jobs argued that offering songs for a single price -- 99 cents in the United States, 79 pence in Britain -- was essential in weaning consumers off the illicit downloads that have ravaged the music industry.

"If they want to raise the prices, it means they are getting greedy," Jobs said in a press conference last year. "If the price goes up, they (consumers) will go back to piracy and everybody loses."

Of the world's biggest music companies -- Universal, Sony BMG, EMI and Warner Music -- all but Universal had pushed for variable pricing to maximize revenue from hot artists. But in the end Apple had more negotiating power because of the dominance of its intertwined iPod player and iTunes service.

http://today.reuters.com/news/articlenews.aspx?type=internetNews&storyid=2006-05-02T160437Z_01_L02207910_RTRUKOC_0_US-MEDIA-APPLE-ITUNES.xml

[Debau2005]

1. Good for Apple, not bowing to pressure! nt

[jsamuel]

2. wow someone with a brain

[LisaM]

3. Forgive my ignorance, but consumers can still buy the actual CDs, right?

It's not as if they can't get the music at all? (I don't have an iPod, and after seeing someone yesterday with an iPod in one ear and a cell phone cord dangling from the other, I've been scared off for life).

[Bush_Eats_Beef]

4. It's a preference, that's all.

I buy CDs, and my iTunes purchases have been minimal...generally when I want to pay 99 cents for one song I like as opposed to 20 dollars for a CD with that one song and 10 others that are terrible.

As the article states, 99 cent song downloads are meant (in part) to draw the crowd that flourished under Napster and illegal downloads to an arena where the artists and record companies profit.

And as one might guess, iTunes did so well that the record companies want more. Apple realized that variable-song pricing would drive these people (to a degree) back to illegal downloads and said no.

I have an iPod that I take to the gym, but I never wear it out on the streets. This is the result of reading one two many stories about people being confronted on the streets by thugs with "give me your iPod" demands. Sometimes the demand includes an ass kicking, knives, guns, whatever.

:toast:

[LisaM]

6. Yikes! My worry is that I depend on my hearing too much

especially after having gotten knocked down by a roller blader while I was jogging - to feel the least bit comfortable having something in my ear while I'm out and about. Now I listen for the sound of wheels and the iPod would probably drown it out.

[LeftyMom]

7. Easiest way to aviod teh "gimme your ipod" thing

is to get rid of the stock white headphones, since they advertise that you've got an ipod in your pocket and they sound like shit anyhow.

I got a really nice sounding sony pair that I like- they sound worlds better and since they're black they don't advertise that they're connected to an ipod.

[Bush_Eats_Beef]

9. You're right...I've seen that mentioned in several stories on the subject.

The goons are definitely looking for those distinctive "ear bud" headphones.

I use Sony headphones for everything else at home...I especially like the noise-cancelling variety.

:toast:

[AndyTiedye]

5. That Person Obviously Needs an iTunes Phone

with an iPod in one ear and a cell phone cord dangling from the other

[Nickster]

8. Bad idea, but hey what do you expect these days?

Here's what I would LOVE to see and I think it would generate tons more revenue for them.

Offer different audio encoding options, and vary the download price by the complexity of the download, so a 128kbs song would be cheaper than the same song encoded at 192kbs and so on. I use a service that does just that and it's great. The newer stuff I can get encoded at CD quality and the older stuff I can take at 128 and I don't pay the same for them.